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Sun, 02 Jul 2017 13:05:02 +0000en-UShourly1https://wordpress.org/?v=4.8.1Will The Pound Bounce Back In 2017?http://forexpredator.com/will-pound-bounce-back-2017.html
Mon, 03 Apr 2017 16:07:07 +0000http://forexpredator.com/?p=606Will The Pound Bounce Back In 2017? This is a great article about the pound below. The pound is going to be one of those currencies to watch over the next few months & during the 2017 year. I mentioned that it will either break out of the range to the upside or the downside […]

The pound is going to be one of those currencies to watch over the next few months & during the 2017 year. I mentioned that it will either break out of the range to the upside or the downside – against the USD.

As of today the GBP has shown strength against many of the other pairs but the intra-day 4hr chart shows many of those pairs now turning over – meaning the GBP is starting to sell off, which is natural after a currency pair has been increasing in value.

It is not in a trend at the moment against the USD but channeling – price moves between a channel – when it reaches the channel top it sells off and when it reaches the channel bottom buyers enter the market.

This is when traders make huge gains. Its now just a matter of waiting.

The French election will also put pressure on the EURO should Le Penn win the election.

Analysts at Barclays believe that sterling will hit $1.32 by the end of this year and rebound to $1.38 against the dollar within 12 monthsCredit:

Sterling will climb back to levels not seen since the Brexit vote by the start of next year, according to analysts who believe the currency is “significantly undervalued”.

Oxford Economics said the pound was undervalued “on a wide range of valuation metrics”, while analysts at Barclays said on one measure sterling had only been cheaper against a basket of currencies during the depths of the financial crisis and the International Monetary Fund’s UK bail-out in the 1970s.

Barclays, Nomura and Citi said near record bets against sterling would start to unwind if the initial constructive tone adopted by the UK and Brussels continued over Brexit negotiations and US president Donald Trump faced further hurdles implementing reforms.

Use regions/landmarks to skip ahead to chart.

Sterling net short positions are close to a record high. Source: CFTC, Bloomberg

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Structure.

Chart type: line chart.

line with 260 data points.

The chart has 1 X axis displaying values.

The chart has 1 Y axis displaying Sterling net short positions.

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Sterling net short positionsSterling net short positions are close to a record highSource: CFTC, Bloomberg20132014201520162017-150k-100k-50k050k100kHighcharts.com

Data published by the Commodity Futures Trading Commission last week showed speculative net sterling short positions stood at 104,075 contracts at the end of March, close to the previous week’s record high.

“To be that short when you’re this cheap seems like a mistake to me,” said Marvin Barth, global head of foreign exchange at Barclays.

Analysts at Barclays believe that sterling will hit $1.32 by the end of this year and rebound to $1.38 against the dollar within 12 months.

Political risks in Europe mean the pound will also climb back to its pre-referendum level against the euro of €1.30 by the start of next year, they said.

Nomura believes the pound is up to 25pc undervalued against the dollar, adjusted for price differences and buying power, though it said a range of economic factors suggest this undervaluation “should sustain” for the forseeable future.

The pound plunged against a range of currencies following the Brexit vote, falling from around $1.45 against the dollar to lows not seen since 1985.

However, sterling posted its first quarterly gain against dollar since June 2015 in the first quarter, closing at $1.2542.

“We expect the triggering of Article 50 to initiate a ‘sell the rumour, buy the fact’ rebound in sterling from historic undervaluation as ambiguity over Brexit recedes”, said Mr Barth.

Oxford Economics also believes the pound will rise to $1.32 against the dollar by the end of the year, and $1.35 in 2018.

“We see risks of an overshoot to our forecast in the intervening period,” said Martin Beck, lead economist at the consultancy.

“There is more than a reasonable chance that pragmatism will prevail and cliff-edges will be avoided given the potential costs to both sides if no agreement is reached.”

Blackrock, the world’s largest asset manager, has retained a long position in sterling. The plunge in the pound’s value in the wake of the vote has also helped to narrow the UK’s current account deficit, which halved at the end of last year.

Analysts said the marked narrowing, which was partly due to a rise in earnings on overseas investments, also suggest the pound is undervalued.

Use regions/landmarks to skip ahead to chart and navigate between data series.

Britain’s current account deficit narrowed sharply at the end of last year. Source: ONS

David Page, senior economist at AXA Investment Managers, said the improvement in the UK’s current account balance, which measures the difference between money flowing in and out of the UK through trade, investment income and transfers to bodies such as the EU, “should limit downside appetite for the pound even as we expect negative headlines from preliminary EU negotiations to mount”.

Analysts also said a short-term rebound in sterling this month was likely.

Strong sterling April seasonals may be inherited from a weak dollar and strong oil, Bank of America Merrill Lynch saidCredit: BoAML

Sterling has climbed against the dollar in April for the last 12 years amid a fall in US Treasury issuance, traditionally stronger demand for crude oil as refineries reopen after maintenance shutdowns, and an influx of foreign capital into the FTSE 100’s commodity giants, pushing up sterling demand.

Analysts at Citi said if the pound climbed to $1.2735 against the dollar this “could trigger a move to [around] $1.34 to $1.35, especially with a significant net short position remaining in sterling.”

]]>Pound v Australian Dollar: GBP extends gains against AUD as retail sales fallhttp://forexpredator.com/pound-v-australian-dollar-gbp-extends-gains-aud-retail-sales-fall.html
Mon, 03 Apr 2017 15:55:57 +0000http://forexpredator.com/?p=604Pound v Australian Dollar: GBP extends gains against AUD as retail sales fall UK MANUFACTURING PMI might have fallen short of forecasts, but the pound is managing to extend gains against the Australian dollar. Watch the GBP closely over the next few months. The GBP is trading in a range and either we will have […]

UK MANUFACTURING PMI might have fallen short of forecasts, but the pound is managing to extend gains against the Australian dollar.

Watch the GBP closely over the next few months. The GBP is trading in a range and either we will have tremendous moves to the upside (opportunity for going long) or we have a break below the support line (opportunity for going short) and this would be another huge move.

Like with fishing, its best to wait for the moves to present themselves before jumping in. Patience is key to trading and this particular pair, when it moves in either one of these directions is going to trend. So keep an eye out on the news.

Stay tuned for our weekly updates and videos on all the major currency pairs.

Dont forget to sign up for your free Forex Guide.

The GBP/AUD exchange rate has bounced back to AU$1.644 thanks to the UK’s latest account reportThe GBP/AUD exchange rate hit a low of AU$1.618 last week but managed to bounce back to AU$1.644 thanks to the UK’s latest current account report.

Friday’s data revealed that in Q4 of 2016 the current account deficit narrowed from -£25.7bn to -£12.1bn.

Given that a spiralling current account deficit was one of the major concerns about the UK’s post-referendum economy, the result gave the pound a boost and GBP also gained on EUR, USD and CAD.

The report was a sign of a move away from debt-based spending and additionally showed the UK coming a step closer to becoming a net lender, rather than a borrower.

Sterling is helping the UK erode the large external imbalance that contributed to the currency’s drop after the Brexit vote

AXA analysts

Analysts at AXA said: “The marked improvement in the current account suggests that at these levels sterling is helping the UK erode the large external imbalance that contributed to the currency’s drop after the Brexit vote.

“This should limit downside appetite for the [pound] even as we expect negative headlines from preliminary EU negotiations to mount.”

Today’s main UK news was the manufacturing purchasing manager’s index (PMI) for March, which disappointed forecasts.

]]>Forex Weekly Update 22/01/2017http://forexpredator.com/forex-weekly-update-22012017.html
Sun, 22 Jan 2017 16:12:18 +0000http://forexpredator.com/?p=588Forex weekly update – based off of the 1 day charts. I you would like to learn how to trade the Forex market, sign up for the free course today. Remember to always, always trade with stop losses. Our goal is not to be 100% correct when timing the markets but to put the odds […]

]]>Forex weekly update – based off of the 1 day charts. I you would like to learn how to trade the Forex market, sign up for the free course today. Remember to always, always trade with stop losses.

Our goal is not to be 100% correct when timing the markets but to put the odds in our favor with Economic data & Technical analysis.

EUR / AUD – Euro seems to have found support, expect upward movement. Perfect to trade on the shorter term time frames. Overall trend is down, remember to trade with the MAIN trend. For a change in trend wait for a new high to be formed for long term trades.

EURO / CAD – Euro edging higher, some resistance as evident by the candle. Still profit potential but expect a pull back at the resistance line.

EURO / NZD – Support base formed – from a daily perspective would like to see more confirmation. The intraday charts would be best to trade this pattern.

Euro / USD – again resistance up ahead, still some movement to the upside. Anticipate fast, volatile trades on the intraday charts. Long theEURO but anticipate the pullback or stalling at resistance.

I expect the pound to make a come back in the short term, support formed here & I anticipate the resistance level to be reached. Nice to trade the intraday on these charts & moves.

GBP / CAD – long the GBP, I anticipate the GBP to make higher highs with the BREXIT announcement and the overall economy doing well.

GBP/CHF – again anticipate the GBP to go higher, bit of indecision seen by the doji at the resistance level but think we will go through this. Fast trades will occur on the intraday charts.

GBP / NZD – same as above. Support being held, MACD divergence, the announcement, economic data all point to the GBP making & gaining its losses from last year. Be aware of the pull backs at the resistance points. Nice candle formation at the end of this chart.

USD /CHF – short the USD here. I anticipate the 200 to be touched and the candle tells me there is a lot of selling pressure with the USD. Main support line also taken out.

USD / JPY – I anticipate the USD will fail this resistance line & continue to be sold short. We see indecision at the resistance line with the doji.